PROMISSORY NOTE









 




Exhibit

10.24




 




PROMISSORY

NOTE




 




	

  $190,000.00


  	

   


  	

  Phoenix, Arizona


  
	

   


  	

   


  	

  December 7, 2001


  
	

   


  	

   


  	

  Note Doc.120701190


  





 




FOR VALUED RECEIVED, and legally bound hereby, RRF LIMITED PARTNERSHIP

(“Maker”), a Delaware partnership, InnSuites Hospitality Trust, General Partner,

an Ohio real estate investment trust, having an office at 1615 East Northern

Avenue, Suite 102, Phoenix, Arizona 85020 hereby promises to pay to the order

of Rare Earth Development Company (“Payee”), an Arizona corporation, 1615 East

Northern Avenue, Suite 102, Phoenix, Arizona 85020 or a such other place as the

holder hereof may from time to time designate in writing, the principal sum of

ONE HUNDRED NINETY THOUSAND AND 00/100 DOLLARS ($190,000.00), with interest on

the unpaid principal balance thereon from time to time outstanding, at the rate

of seven percent (7.00%) per annum, computed on a three hundred sixty (360)-day

year, to be due and payable in installments of principal and interest as

follows:




 




(A)                              Commencing on July 15, 2002, one annual

payment of accrued but unpaid interest on the outstanding principal balance

hereunder; and on July 15, 2002 (the “Maturity date”), one payment in the

amount of the then unpaid principal balance hereunder and all sums and charges

due and unpaid by Maker (collectively, the “Note”).




 




(B)                                Upon sale or refinance of hotel/s, half

of net proceeds shall be made available at option of hotel/s to prepay on this

note.




 




Payments shall be applied first to any charges or sums (other than

principal and interest) due and payable by Maker, second to accrued and unpaid

interest on the principal balance hereof, and then to further reduce the

principal balance of this Note.




 




Maker shall gave the right any time during the term of this Note to

repay all or part of the unpaid principal amount of the Note, together with any

accrued and unpaid interest thereon any other sums or charges due hereunder

without any prepayment premium or penalty.




 




Maker hereby waives for itself and, to the fullest extent not

prohibited by applicable law, for any subsequent lienor, any right Maker may

now or hereafter have under the doctrine of marshaling of assets or otherwise

which would require Payee to proceed against certain property before proceeding

against any other property.




 




Maker hereby agrees that in the event part of principal or interest is

not paid when due or the entire Note is not paid when due, then the rate of

interest on this Note shall, at the election of Payee upon ten (10) days prior

written notice, each of which is hereby




 




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expressly waived, be increased to nine and 00/100 percent (9.00%) per

annum or the highest rate for which the parties may agree under applicable law,

whichever is less (the “Default Rate”). Maker shall be obligated thereafter to

pay interest on the then unpaid principal balance of the Note at the Default

Rate, both before and after judgment, to be computed from the due date through

and including the date of actual receipt of the overdue payment, whether a

payment of interest or the entire Note. 

Nothing herein shall be construed as an agreement or privilege to extend

the date of the payment or any installment or the entire Note, or as a wavier

of any other right or remedy accruing to Payee.




 




In the event that any regular payment of interest herein provided shall

not be received by Payee on the date such payment is due, Payee shall have the

right to assess Maker a late payment charge in the amount of two percent (2.0%)

of such overdue quarterly installment, which shall become immediately due to

Payee for the additional cost agreed compensation to Payee for the additional

costs and expenses reasonable expected to be incurred by Payee by reason of

such nonpayment.  Maker acknowledges

that the exact amount of such cost and expenses may be difficult, if not

impossible, to determine with certainty, and further acknowledges and confesses

the amount of such charge to be a consciously considered, good faith estimate

of the actual damage to Payee by reason of such default.  The Default Rate will only accrue for

periods of delinquent installments except for such when Payee accepts late

payments of installments accompanied by a late payment charge as specified

above.




 




Upon any of the following Events of Default, at the election of Payee,

the entire unpaid principle balance of the Note, together with all accrued but

unpaid interest thereon at the Default Rate and all other sums or changes due

hereunder, shall become due and payable:




 




(a)                                  Maker’s failure to pay when due any

installment required to be paid hereunder, on or before the tenth (10th)

day following the applicable due date;




 




(b)                                 Maker’s failure to pay when due any other

payment required to be under this Note, subject to any notice and applicable

grace period, if any;




 




(c)                                  Maker’s breach of any other covenant or

agreement herein and such breach remains uncorrected at the expiration of any

applicable grace period expressly provided for herein;




 




(d)                                 Any creditor’s proceeding in which Maker

consents to the appointment or a receiver or trustee for any of its property;




 




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(e)                                  if any order, judgment or decree shall be

entered, without the consent of Maker, upon an application of a creditor

approving the appointment of a receiver or trustee for any of its property, and

such order, judgment, decree, or appointment is not dismissed or stayed with an

appropriate appeal bond within sixty (60) days following the entry or rendition

thereof; or




 




(f)                                    if Maker (i) makes a general assignment

for the benefit of creditors, (ii) fails to pay its debts generally as such

debts become due, (iii) is found to be insolvent by a court of competent

jurisdiction, (iv) voluntarily files a petition in bankruptcy or a petition or

answer seeking readjustment of debts under any state or federal bankruptcy or

like law, or (v) any such petition is filed against Maker and is not vacated or

dismissed within sixty (60) days after filling thereof.




 




Notice of such election by Payee is hereby expressly waived as part of

the consideration for this loan. 

Nothing contained herein shall be construed to restrict the exercise of

any other rights or remedies granted to Payee hereunder upon the failure of

Maker to perform any provision hereof.




 




If this Note is not paid when due, whether at maturity or by

acceleration, Maker promises to pay all costs incurred by Payee, including

without limitation reasonable attorney’s fees to the fullest extent not

prohibited by law, and all expenses incurred in connection with the protection

or realization of any collateral, whether or not suit is filed hereon or on any

instrument granted a security interest.




 




Maker hereby expressly acknowledges and represents that the

indebtedness is for a business purpose and not consumer or household purposes.




 




Maker hereby waves demand, presentment for payment, protest, notice of

protest, notice of non-payments and any and all lack of diligence or delays in

collection or enforcement of this Note, and expressly consents to any extension

of time of payment hereof, release of any party primarily or secondarily liable

hereunder or any of the security for this Note, acceptance of other parties to

be liable for any of the Note or of other security therefore, or any other

indulgence or forbearance which may be made, without notice to any party and

without in any way affecting the liability of any party.




 




No failure by Payee to exercise any right hereunder shall be construed

as a waiver of the right to exercise the same or any other right any time or

from time to time thereafter.




 




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This Note shall be construed and enforced according to, and governed by

the laws of the State of Arizona.




 




Any notice required hereunder shall be in writing, and shall be given

to the receiving party the notice by personal delivery or be certified mail,

postage prepaid, return receipt requested, as follows:




 




if to Payee, then addressed to Payee at 1615 East

Northern Avenue Suite 102, Phoenix, Arizona 85020, (Tel. (602) 944-1500, Fax

(602) 678-0281, with a copy to James W. Reynolds, Esq., Dillingham Cross,

P.L.C., 5080 North 40th Street, Suite 335, Phoenix, Arizona 85018,

(Tel. (602) 468-1811, Fax (602) 468-0442);




 




if to Maker, then addressed to maker at 1615 East

Northern Avenue, Suite 102, Phoenix, Arizona 85020, Attn: President (Tel. (602)

944-1500, Fax (602) 678-0281), with a copy to James B. Aronoff, Esq., Thompson

Hine & Flory, LLP, 3900 Key center, 127 Public Square, Cleveland, Ohio

44114 (Tel. (216) 566-5500, Fax (216) 566-5800).




 




Any party may, be given notice in writing to designate another address

as a place for service of notice. Such notices shall be deemed to be received

when delivered, if delivered in person, or seven (7) business days after

deposited in the United States mails, if mailed as herein above provided.




 




By acceptance of this Note, Payee agrees that, upon payment in full of

the then unpaid principal balance of this Note, together with all unpaid

interest and other sums payable to Payee under this Note, (a) Note shall be

fully satisfied, (b) Payee shall promptly mark this Note as being paid in full,

satisfied and discharged and shall return the same to Maker.




 








	

  RRF LIMITED PARTNERSHIP, a


  
	

  Delaware limited partnership,


  
	

  InnSuites Hospitality Trust, General Partner,


  an Ohio real estate investment trust


  










 








	

  By: 


  	

  /s/ Marc E. Berg


  	

   


  
	

   


  	

  Name: Marc E. Berg


  
	

   


  	

  Title:  

  Executive Vice-President


  
				










 




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